25 & 26 ,March 2018

The Ministry of Human Resource Development has nominated former NCERT director JS Rajput as India’s representative to Executive Board (EXB) of United Nations Educational, Scientific and Cultural Organization (UNESCO).

The EXB is one of the constitutional organs of UNESCO and is elected by the General Conference. It has four-year term and 58 seats. The board examines work for UNESCO and the corresponding budget estimates. In practice, it is main organ responsible for all policies and programmes of UNESCO.

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1.Banks told to be vigilant on AadhaarSource: The Hindu

The Unique Identification Authority of India (UIDAI) has asked banks to provide Aadhaar-based onetime password (OTP) for opening of bank accounts only in the presence of the customer, in a banking outlet.

The direction is a huge blow to the banks that are heavily dependent on Aadhaar-based OTP authentication process for account opening (where the customers do not have to visit branches) or use tab banking to open accounts by visiting the customer’s residence.

UIDAI’s concerns

There has been instances wherein: Aadhaar of person A got seeded with person B’s account to carry out fraudulent transaction

Stolen Aadhaar copy was used to open a bank account and obtain credit, debit card

The UIDAI said a fabricated Aadhaar card provided to a bank may result in fraud and loss of money, if the bank does not authenticate with finger print or OTP to adequately identify the Aadhaar holder

There are Limits on accounts opened via Aadhaar based OTP authentication process

According to RBI norms, there are limits for accounts that are opened through Aadhaar-based OTP authentication process, like deposits cannot exceed Rs. 1 lakh and full KYC requirements, which is submission of documents and giving biometric details, were needed to be made in 1 year.

2.Draft Defence Production Policy, 2018Source: The Hindu

The defence ministry has come out with a draft policy on defence production. The aim is to make India one of the top five manufacturers of defence platforms with active participation of public and private sectors. At present, India is one of the world’s largest importer of military platforms and weapons.

It envisages achieving a turnover of Rs 1,70,000 crore in military goods and services by 2025 by promoting the domestic defence industry.

The policy lists as a major aim achieving export of Rs 35,000 crore in military equipment and services by 2025 by promoting the domestic defence industry.

According to the policy, the government aims to make India self-reliant in defence production as well as fulfil demand of other friendly countries.

The policy says the licensing process for defence industries will be liberalised and the list of items requiring licences will be reviewed and pruned.

The policy says the tax regime will be rationalised to make domestic manufacturing attractive by ensuring that there is no tax inversion. Taxes on import of capital goods and services, inputs and components used in defence production will be rationalised.

The government identified 12 military platforms and weapons systems for production in India to achieve the aim of “self-reliance”. They are fighter aircraft, medium lift and utility helicopters, warships, land combat vehicles, missile systems, gun systems, small arms, ammunition and explosives, surveillance systems, electronic warfare (EW) systems and night fighting enablers, among others.

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3.New vehicle scrappage policy may need tinkeringSource: The Hindu

The new vehicle scrappage policy of the Centre is unlikely to have any significant impact on the automobile industry in terms of increased demand, according to rating agencies.

The Draft Policy

The policy, targets to take polluting vehicles out of the roads and help the automobile industry register higher sales.

The draft policy, mentioned about vehicles older than 15 years becoming eligible for benefits under the scrappage scheme but the criteria was reworked with benefits being applicable to vehicles older than 20 years.

The scheme would now come in effect from April 1, 2020, coinciding with the implementation of the BS-VI norms.

Impact:

The new vehicle scrappage policy of the Centre is unlikely to have any significant impact on the automobile industry in terms of increased demand, according to rating agencies. Also, analysts say the benefit offered under the scrappage policy would be 15% of the vehicle’s price. But this advantage would be muted as prices of diesel vehicles were expected to rise 10-15% once the new norms (BS-VI) come into force.

CRISIL

The total population of commercial vehicles that will be older than 20 years in fiscal 2021 would be 50,000 vehicles, much lower than the government’s earlier estimate of 2.8 crore vehicles and our internal estimate of 6,40,000 vehicles. In any case, 70,000 to 90,000 vehicles are scrapped every year. So,the impact of the scrappage policy will be limited.

ICRA

The proportion of commercial vehicles above 20 years would be one lakh to two lakh units. Besides, most of these older vehicles are used in rural areas and smaller towns by small fleet operators who operate used vehicles and have limited financial resources to purchase new vehicles. Thus, the proposed scrappage policy is unlikely to be materially positive for commercial vehicle demand.

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4.The first-ever National Conference on Drug Law EnforcementSource: PIB

The first-ever National Conference on Drug Law Enforcement was held in New Delhi. The 2-day conference was organized by Narcotics Control Bureau (NCB), Ministry of Home Affairs.

More than 50 State and Central law enforcement agencies involved in combating drug trafficking had participated in this Conference. The working sessions of conference focused on various topics such as ‘Wider context of drug trafficking in India’, ‘Financial Investigations’ and ‘Foreign & Cyber Investigations’. During these sessions various agencies gave presentations. United Nations (UN) and other foreign law enforcement agencies also shared their experiences.

Narcotics Control Bureau (NCB):

NCB is nodal drug law enforcement and intelligence agency of India. It is responsible for fighting drug trafficking and the abuse of illegal substances. It functions under Ministry of Home Affairs (MHA) and is headquartered in New Delhi.

It was established in March 1986 to enable full implementation of Narcotic Drugs and Psychotropic Substances Act, 1985 and fight its violation through Prevention of Illicit Trafficking in Narcotic Drugs and Psychotropic Substances Act, 1988.

It mandates:

Fight drug trafficking on all-India level.

Provide resources and training to personnel of India’s law enforcement agencies in fighting drug trafficking.

Monitor India’s frontiers to track down points where smuggling activities take place with foreign traffickers.

Work in close cooperation with Customs and Central Excise, State Police Department, Central Bureau of Investigation (CBI), Central Economic Intelligence Bureau (CEIB) and other Indian intelligence and law enforcement agencies both at the national and states level.

A Parliamentary panel has recommended the earmarking of a defined portion of proceeds from the divestment of State-owned enterprises for funding revival, restructuring and modernisation proposals of sick public sector undertakings (PSUs) that have the potential to turn around. In this manner, the government can extend a hand-holding support to the select sick PSUs that have the potential to turn around and sustain themselves in the future.

Divestment target:

The government had set a target of raising Rs. 80,000 crore in 2018-19 by selling stakes in the State-owned firms, with strategic divestment of 24 CPSEs (central public sector undertakings) on the cards and privatisation of Air India on track.

Besides, NITI Aayog is preparing another list of sick PSUs that can be privatised, its chief executive officer Amitabh Kant said last month. The Prime Minister’s Office (PMO) had asked the think-tank to look into the viability of sick State-run companies.

The Aayog had already recommended strategic divestment of 40 sick public sector undertakings.

In its report, the Parliamentary Standing Committee on Industry said it was of the firm opinion that while making a decision to disinvest PSUs, especially those that are profit-making, the government must accord due consideration to the jobs supported by them, the track record of their contribution to the national economy, their capex (capital expenditure) creation potential and also their role in balancing the social/regional fabric.

The committee observed that timely approval of revival/restructuring/modernisation plans of CPSEs with accurate cost estimates, availability of funds with the government and the timely disposal of such funds are crucial factors.

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6.Panagariya bats for Privatisation of PSBsSource: The Hindu

Former NITI Aayog vice chairman Arvind Panagariya has made a strong case for privatisation of public sector banks with the exception of SBI.

Need for Privatisation:

Mainly, predominance of scandals and NPAs in PSBs highlight the need for privatisation of PSBs. Efficiency and productivity too demand that the government relinquish its control of the large number of banks whose market valuation has dwindled despite the fact that they hold the bulk of the deposits.

Also, there is a continuous pressure on the government finances on account of the weak performance of the banks. Privatisation would reduce the drain on the exchequer and the money saved could be used for developmental schemes and programmes of the government.

Benefits of private banks:

Private banks will bring innovations in products, technology and customer servicing and a market-based discipline to lending. Private banks, knowing that they cannot count on government’s protection, are unlikely to engage in the sort of risky lending that characterised public bank lending. Also, they will not be subject to the same pressure from politicians and others in government that has destroyed the public sector banks.

Way ahead:

The public-sector banks, which constitute almost 70% of the Indian banking system, are saddled with burgeoning stressed assets. The government has already injected over 2.6 lakh crore in the public-sector banks through recapitalisation in the last eleven years, which has had limited impact in improving the health of public sector banks thus far.

Therefore, recapitalisation of PSBs alone is not a permanent solution and will not be effective unless the inherent issues related to governance, productivity, risk management, talent, customer service, etc. are resolved. The government should shrink unproductive public sector banks and move forward with increasing private sector participation in the banking sector.

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7.Centre to ease access to border areas with an eye on tourismSource: The Hindu

The Centre is set to relax the Protected Area Permit (PAP) regime to enable foreign tourists to access border areas. The move follows several requests from the border States of Arunachal Pradesh, Himachal Pradesh, Sikkim, Uttarakhand, Nagaland and Manipur and also the Tourism Ministry

Protected Area Permit (PAP)

Under the Foreigners (Protected Areas) Order, 1958, all areas falling between the ‘Inner line’ and the International Border of the State have been declared as a ‘Protected Area’

This is applicable to all of Arunachal Pradesh and Sikkim, parts of Himachal Pradesh, Jammu and Kashmir, Manipur, Mizoram, Nagaland, Rajasthan and Uttarakhand

Every foreigner, except a citizen of Bhutan, who wants to enter and stay in a Protected Area, is required to get a special permit

Citizens of Afghanistan, China and Pakistan and foreign nationals of Pakistani origin are not issued the permit without the Home Ministry’s approval

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8.GSAT-6A to give armed forces a shot in the armSource: The Hindu

GSAT-6A, the second predominantly S-band communications satellite, is set to be launched from Sriharikota on March 29.

It will complement GSAT-6, which has been orbiting since August 2015 at 83 degrees East longitude. The 2,000-kg-class 6A, costing about Rs. 270 crore, is a great deal more than a routine communications satellite. It is designated for the use of the Armed Forces and will not add any transponder capacity for general uses, according to sources in the Indian Space Research Organisation (ISRO).

A special feature of the GSAT-6A is its 6-metre-wide umbrella-like antenna, which will be unfurled in once it is in space. The antenna is thrice as broad as the antennas generally used in ISRO satellites. It will enable mobile communication from anywhere via hand-held ground terminals. Regular communication satellites with smaller antenna require much larger ground stations, said a former director of ISRO.

The S-band’s antenna was developed by ISRO’s Space Applications Centre, Ahmedabad.

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